Comment by JuniperMesos

Zip codes with terrible education outcomes are almost certainly proxies for zip codes with lots of black and hispanic students living in them. The fact that race correlates highly with zip code is why it is illegal under laws banning racial discrimination in financial services for banks and other loan-granting financial service companies to use zip code data as an input for computing the likelihood that a borrower will repay their loan. And if it's reasonable to legally ban moneylenders from looking at zip code data to determine likelihood of paying back a loan because it's a good proxy for race, it's reasonable to ban colleges from using it as a reason to give a handicap to college admissions for the same reason.